Saturday, November 29, 2014

Who runs Britain? How the Super-Rich are changing our lives. By Robert Peston, Hodder & Stroughton. 2008.

According to Peston, currently the BBC’s business editor, it’s the new super-rich of private-equity and hedge-fund capitalists. They run the country in the sense that the present Labour government feels the need to kow-tow to them for fear of them taking their businesses elsewhere:

“Much of this book is about how New Labour in Government has never flinched from the view that economic disaster for the UK and electoral disaster for Labour would be inevitable if the super-wealthy ever felt their interests were under attack in the UK. Blair and Brown are true believers in one of the main commandments of the Book of Globalization: ‘Thou shalt not be seen to use the tax system to take from the well-heeled, for fear of driving them and all their valuable capital into exile’”.

A number of these capitalists have been given knighthoods and peerages and – this came first of course – have made very generous contributions to the Labour Party amounting in total to millions of pounds. In fact, they – rather than the trade unions – funded Labour’s last three successful election campaigns. Peston’s chapter on the dealings between Blair, Brown, Lord Levy and those he call’s Labour’s “plutocratic benefactors” can only confirm disgust and contempt for the leaders of the Labour Party for the lengths they are prepared to go just to stay in power.

The new super-rich come across as a bunch of loud-mouthed upstarts who buy companies, “rationalise” them at the expense of the workforce, and then sell them, pocketing a huge personal profit for themselves. Their profit is personal because they own their own companies outright and so have a much freer hand to do what they want, not having to comply with the normal company law that applies to “public”, shareholder-owned companies.

Although he criticises them for not paying their fair share of taxes and as a potential threat to political democracy, Peston cannot disguise his admiration for them, seeing them as fulfilling an essential role within capitalism of channelling capital into the most profitable lines of activity (instead of it stagnating in long-established businesses run by stuffy ex-Etonians). He wants the managers of pension funds to behave in the same ruthless way towards the companies they’ve invested the funds in, so as to bring in more money for present and future pensioners.

His chapter on pensions – and the run-down of final-salary company pension schemes – is instructive. Employers originally set these up to retain the loyalty of their salaried employees, but over the years governments have imposed so many obligations on them (frozen pensions, pension transfers, taxes, etc) that it has become no longer worth their while keeping them going. So they have been disposing of them to, among others, private-equity capitalists who hope to make a profit out of investing their funds.

In other words, reforms aimed at protecting people’s pension rights have had the opposite effect. Employers have walked away, leaving workers without the desired protection. Another lesson in the futility of reformism.

Single issue campaigners ignore the root cause of the problems they highlight and continue along the road of calling for a reform here and there.

Looking back is enormously important to understanding what must be done to avoid repeating earlier mistakes. Unless deliberate steps are taken to change the ultimate direction of politics and economics then people’s needs and welfare will continue to be treated as of lesser import to the overall system. The challenge is more than overcoming an unending string of 'single issues.' It is recognising the overriding necessity for a coherent, viable system which finally serves the people –a truly social system.

As individuals, it's possible or even likely that certain 'single issues' strike a chord which are more personal or pertinent than others. However, until the realisation hits home that they are all the result of capitalist norms and that it is the cause that has to be dealt with, not the effects, we, as 'the 99%' will continue along the road of calling for a reform here and there, and inviting for ourselves and future generations more of the torture we vowed to end.

Shortfalls

The shortfalls of capitalism, in the news big time last year, have been expressed loud and clear around the world. Numerous items for serious discussion which are generally labelled political, economic or social have been raised but which can rarely be considered in one of these areas in isolation. The links between these three areas and between the separate issues are more of a tangled web than isolated connections.

Consider the connections here in matters which would be seen by activists as environmental problems: mountain top removal for coal, deforestation for monocrops, localised industrial pollution of water, air and ground, depleted uranium contamination from wars, nuclear waste from energy production, etc. All are primarily urgent social problems for reasons of serious risk to the short- and long-term health of workers and their communities but which have been subsumed by the imperative of business and 'the market' to continue making profits - economic considerations come first. Politics being so intricately bound to capitalist economics, politicians are required to make decisions to uphold the system and keep it running as efficiently and profitably as possible. Whichever single issue is selected for scrutiny a similar pattern appears –when it comes to the crunch, decision time, however, the vast majority of politicians smothers it with platitudes and toes the economics line.

When problems related to work are considered it is found that what concerns the worker is different from what concerns the employer. Everything, every angle, every detail, every aspect is decided according to economics. Hourly pay; sick benefits; overtime; final pension; holiday, and paternity or maternity leave, and contracts are for the employer to break or change –not the employee. Time for breaks and lunch, penalties for late arrival, sudden lay-offs, unexpected redundancies, late meetings –you name it, they decide. Trades unions may manage to fight off some of the worst pay cuts, reduce some of the workforce losses and maybe claw back some previously lost advantage, but overall they are fighting an endless, losing battle. A brief scan at statistics clearly shows which side is winning. A social system would approach the work situation from a different perspective: what work is needed to be done by and for cooperating communities, how it can be shared out, satisfaction at work, full participation in decision making and common ownership of all the means of living.

Identifying the cause

When broken down, it can be seen that the stand-alone 'single issues' all spring from a common root, that of the world capitalist system which places the economy and politics above social considerations. One of the more noticeable factors common to popular demands being made around the world is that individuals within the occupations and uprisings have taken note of the indisputable position of the vast majority –'the 99%' –and are protesting and rejecting it.

It is unacceptable to them to be without a voice or proper representation; to be denied free speech within supposed democracies; to have banks and too-big-to-fail companies bailed out whilst witnessing record numbers of house repossessions, unemployed, and children in poverty; to witness increased spending on the military, and huge hikes in the cost of further education; to see social services and public sector personnel hammered; to have all kinds of deals and social contracts reneged on as political and corporate interests refuse to grapple with the problems of climate change; and on and on ad infinitum.

End not mend

Anyone who has tried to remake a garment, repair a complicated bit of carpentry, refashion an item from mismatched pieces or in any way attempted to put something back together so that it works well when it didn't fulfill its function properly to begin with will know that it's far simpler to start from scratch and create a new item. So it is with capitalism and reformism –bin the idea of trying over and over to reform something that has never worked for the vast majority, tweaking it a bit here and there and then having to have another go at it a few months or years down the road when it comes apart again. Far better to use the combined energies of all those seeking a better way of living and working, one based on people as social beings, to organise together according to real democratic principles to bring in a new social system altogether.

If we are seeking an end to the current structure of relations which puts economic matters at the forefront of each and every issue and which is supported wholeheartedly by the current political system then it follows that we are determined to pursue a system organised for the benefit of all –one where social need is the guiding principle. Many social movements and activists go a long way to pointing out just such failings as have been written about here but most fall at the last hurdle. They will reveal the reasons for failure clearly enough; the capitalist economic system that doesn't work for the mass of the people, the logic of which sets out deliberately to fail many. They talk about, suggest, even demand actions to socialise, to redistribute or more fairly distribute assets, jobs, wages, access to land and the means of living but fail to see they are calling for something from a system that can't respond to their demands because of its innate logic.

Making any significant changes calls for a thorough understanding by the majority of a different kind of politics. A raising of awareness of how participatory democracy can really change the status quo to a democracy that is actually, noticeably, determinedly and deliberately organised to reinforce the social aspect by placing the satisfaction of human needs, not economics, at the forefront of all decision-making. This can only be achieved by first removing the primary cause of previous failures, that is, by removing the capitalist system itself. The system of socialism, by its very principles, is a whole lot simpler than that which has had to be endured daily within the capitalist system. Removing the prime motivation of continuous accumulation by ending all incentives or inducements for pecuniary advantage in favour of free access for all empowers the majority. This broad democratic shift to revolutionise the political and end the economic will complete the transformation to the new social system.